Oil rises on hopes for deeper OPEC output cuts, US-China trade talks

OPEC lowered its 2019 global oil demand growth forecast to 0.98 million barrels per day. (AFP)
Updated 11 October 2019

Oil rises on hopes for deeper OPEC output cuts, US-China trade talks

  • OPEC lowered its 2019 global oil demand growth forecast to 0.98 million barrels per day
  • Top US and Chinese negotiators wrapped up the first of two days of scheduled trade talks on Thursday

SEOUL: Oil prices climbed early on Friday, building on gains in the previous session, after producer club OPEC hinted at making deeper cuts in supply while optimism was revived over talks between the United States and China to end their trade war.
International benchmark Brent crude futures were at $59.26 a barrel by 0251 GMT, up 16 cents, or 0.3 percent, from their previous settlement. Brent settled up 1.3 percent at $59.10 a barrel on Thursday.
US West Texas Intermediate (WTI) crude futures rose 16 cents, also up 0.3 percent, from their last close to $53.71 per barrel. In the previous session, WTI settled 1.8 percent higher at $53.55 a barrel.
On Thursday Mohammad Barkindo, Secretary-General of the Organization of the Petroleum Exporting Countries (OPEC), said all options were on the table, including a deeper supply cut to balance oil markets. A decision would be taken at a December meeting between the OPEC and its partners, he said.
OPEC lowered its 2019 global oil demand growth forecast to 0.98 million barrels per day (bpd), while leaving its 2020 demand growth estimate unchanged at 1.08 million bpd, according to OPEC’s monthly report.
Beyond OPEC, trade talks between the United States and China also remained on the market’s radar as the world’s top two economies seek to resolve a more-than-a-year-long trade row that has slowed global economic growth and curbed fuel consumption.
“Oil bought into the upbeat tone from the bilateral talks as well, for better or for worse, and was also boosted by fighting talk on prices by the OPEC secretary-general,” said Jeffrey Halley, a senior market analyst at OANDA in Singapore.
Top US and Chinese negotiators wrapped up the first of two days of scheduled trade talks on Thursday, with business groups expressing optimism that the two sides might be able to ease tensions and delay a US tariff hike set for next week.
“The United States is the largest global consumer of oil while China, the biggest driver of year-on-year oil demand growth,” said Stephen Innes, Asia Pacific market strategist at AxiTrader.
“The most significant sentiment driver hinges on the outcome of the trade talks which, if (they) end on a positive note, could go a long way to begin to repair the economic damage done ... these economic powerhouses would need more oil,” said Innes.


Boeing: Timing of 737 MAX return in hands of regulators

Updated 16 November 2019

Boeing: Timing of 737 MAX return in hands of regulators

  • Boeing earlier said it expected the US Federal Aviation Administration to certify the 737 MAX in mid-December

DUBAI: Boeing said on Saturday the US Federal Aviation Administration and other global regulators would decide the timing of the return to service of its 737 MAX, which has been grounded since March in the wake of two fatal crashes.
The head of the FAA has told his team to “take whatever time is needed” in its review of the MAX, according to a Nov. 14 memo seen by Reuters, issued days after Boeing said it expected the FAA to certify the 737 MAX in mid-December.
“The FAA and regulators around the world control the schedule,” Stan Deal, chief executive of Boeing Commercial Airplanes, told a news conference on the eve of the Dubai Airshow.